Sinclair makes bid to buy Scripps

Comes after Trump expresses disdain 

The bid to increase scale in local television has turned into an arms race. 

Sinclair is the latest to make a bid to acquire a rival, this time Cincinnati-based E.W. Scripps, a company that was founded in 1878 as a newspaper chain. If successful, Sinclair would own and/or operate around 250 stations in the U.S., including large markets in politically swing states Ohio, Michigan, and Wisconsin. Sinclair is offering $7 a share, as the company acquired an eight percent stake in the company last week, and has increased to ten percent since.  

The unsolicited bid comes as Nexstar is looking to buy Tegna for $6.5 billion, which was announced last month. Scripps shareholders would get $7 a share ($2.72 cash and the rest in combined company common stock.) 

“Consistent with its fiduciary duties and in consultation with its legal and financial advisors, the company’s board of directors will carefully review and evaluate any proposals, including the unsolicited Sinclair proposal, to determine the course of action that it believes is in the best interests of the company and all of its shareholders as well as its employees and the many communities and audiences it serves across the United States,” Scripps said in a statement. “The company does not intend to comment further on Sinclair’s unsolicited proposal until the board has completed its review.” Sinclair said it has a deadline of Dec. 5 to accept its bid. 

The announcement came hours after President Trump, on his Truth Social platform, expressed opposition to the idea of lifting the 39 percent station ownership cap, but mostly to prevent Disney (ABC) and Comcast (NBC) from buying more stations.

Trump tagged Newsmax’s Chris Ruddy, who opposes lifting the cap, fearing more competition from Sinclair, which could take Scripps’ over-the-air network Ion and transition it into a national conservative news channel as another small conservative news network (OANN) is against the deal as well. Trump’s comments contrast with those of FCC Chairman Brendan Carr, who indicated he would support raising or even eliminating the cap. Carr has yet to comment as stocks for Nexstar and other big broadcasters slid Monday morning.

Nexstar basically shrugged off Trump’s post in this statement: 

“We continue to believe that the landscape is ripe for regulatory reform and that we are on the path to completing our transaction. We agree with President Trump that the status quo is no longer acceptable, nor should the government do anything to strengthen the stranglehold of legacy media and Big Tech on the marketplace of ideas. Those platforms already reach into every pocket, purse, and backpack in America, and the best way to disrupt their monopolistic power is to allow local broadcasters an opportunity to compete on a level playing field.

“Americans want more access to local news and a variety of voices without the filter of the coastal elites. By modernizing the FCC’s rules, regulators will ensure that local communities benefit from an array of fact-based local journalism — the anti-fake news — for years to come.”

The “coastal elites” term is basically a shot at the broadcast networks based in New York and Los Angeles – two solidly blue cities where Nexstar also competes with the network-owned-and-operated stations with CW affiliates WPIX (through Mission) and KTLA, despite Nexstar having numerous ABC and NBC affiliates in its portfolio. In Chicago, Nexstar’s WGN recently poached NBC-owned WMAQ-TV’s news director, and its morning show openly crowed about it on the air, which is known for also taking shots at ABC-owned WLS-TV and Fox-owned WFLD-TV.

In addition to Chicago, the major broadcast networks own stations in heavily-blue Philadelphia and San Francisco. 

Meanwhile, opposition is already building to Sinclair’s potential purchase of Scripps, with ACA Connects stating that more blackouts, higher cable/satellite bills, and more programming blackouts may be on the horizon if this purchase and the Nexstar/Tegna mergers are approved.

If anything, nobody should read into Trump’s comments about the cap. All it takes is one meeting at the White House with the NAB or executives of these broadcast groups, and his mind will likely change. Buying broadcast stations isn’t on Disney’s and Comcast’s radar right now, as the latter’s purchases during the last few years have been mostly related to Telemundo stations, a Spanish-language network NBC owns. In fact, Disney Chairman Bob Iger briefly considered selling ABC and its owned stations before relenting. 

While these two potential mergers would give the Trump-friendly Nexstar and Sinclair more reach and leverage, each company would wind up billions more in debt (like we saw more than twenty years ago when Clear Channel bought up radio stations and wound up filing for bankruptcy.) Layoffs would be inevitable, despite their claim to invest in local news. Since their merger with Skydance, Paramount has laid off approximately a thousand employees and is expected to lay off 1,600 more in the coming months as the company pursues a merger with Warner Bros.